Senior Secured Credit Facility	3 Months Ended
Mar. 31, 2017
Senior Secured Credit Facility
Senior Secured Credit Facility	8. Senior Secured Credit Facility On December 1, 2016, Solaris LLC entered into a credit agreement (the “Credit Agreement”) by and among Solaris LLC, the lenders party thereto from time to time and Woodforest National Bank, as administrative agent (the “Administrative Agent”), providing for $11.0 million aggregate principal amount of senior secured credit facilities (the “Credit Facility”). The Credit Facility initially consisted of (i) up to $10.0 million aggregate principal amount of advance term loan commitments (the “Advance Loan Facility”) available for borrowing until December 1, 2017 and (ii) up to $1.0 million aggregate principal amount of revolving credit commitments (the “Revolving Facility”) available for borrowing until December 1, 2018. As of March 31, 2017, the borrowing base certificate delivered by Solaris LLC under the Revolving Facility reflected a borrowing base as of such date of $1.0 million. As of March 31, 2017, Solaris LLC had $1.0 million outstanding under the Revolving Facility and $1.5 million under the Advance Loan Facility, of which $0.1 million was current. The Company borrowed an additional $3.0 million under the Advance Loan Facility in April 2017. Proceeds from the Offering were used to fully repay the $5.5 million outstanding under the Credit Facility in May 2017. Interest expense for the three months ended March 31, 2017 bore interest at a weighted average interest rate of 5.33%. On May 17, 2017, in connection with the Offering, the Company entered into an amendment (the “First Amendment”) to the Credit Agreement (as amended by the First Amendment, the “Amended Credit Facility. The First Amendment, among other things, modified the terms of the Credit Agreement to (i) increase the Revolving Facility from $1.0 million to $20.0 million, (ii) decrease the Advance Loan Facility from $10.0 million to $0 and (iii) amend both the scheduled maturity date of the Revolving Facility and the Advance Loan Facility to be May 17, 2021. Additionally, the First Amendment increased the accordion feature of the Revolving Facility from $1.0 million to $10.0 million, which accordion may be elected by the Company at any time prior to the scheduled maturity date of the Revolving Facility so long as no default or event of default shall have occurred and be continuing and provided that no lender has any obligation to increase its own revolving credit commitment. The Amended Credit Facility permits extensions of credit up to the lesser of $20.0 million and a borrowing base that is determined by calculating the amount equal to the sum of (i) 80% of the Eligible Accounts (as defined in the Amended Credit Facility), (ii) 65% of the Eligible Inventory/Equipment Value (Appraised) (as defined in the Amended Credit Facility) and (iii) 75% of the Eligible Inventory/Equipment Value (New Build, Acquired or Upgraded) (as defined in the Amended Credit Facility). The borrowing base is calculated on a monthly basis pursuant to a borrowing base certificate delivered to the Administrative Agent and an annual appraisal on the equipment delivered to the Administrative Agent (provided that the Administrative Agent may, at its discretion, require a desktop appraisal on equipment every six months). Borrowings under the Amended Credit Facility bear interest at a one-month London Interbank Offered Rate (“LIBOR”) plus an applicable margin and interest shall be payable monthly. The applicable margin ranges from 3.00% to 4.00% depending on the Company’s leverage ratio. The leverage ratio is defined in the Amended Credit Facility, as of any day, as the ratio of funded indebtedness, less a cash adjustment of the lesser of $10.0 million or fifty percent of unrestricted cash of the Company and its subsidiaries, to EBITDA, for the twelve months then ended (the “Leverage Ratio”). During the continuance of an event of default, overdue amounts under the Amended Credit Facility will bear interest at 5.00% plus the otherwise applicable interest rate. The Revolving Facility initially had a scheduled maturity date of December 1, 2018 and the Advance Loan Facility initially had a scheduled maturity date of December 1, 2021. The First Amendment extended the scheduled maturity of the Revolving Facility and Advance Loan Facility to May 17, 2021. The First Amendment modified the monthly commitment fee we pay on undrawn amounts of the Revolving Facility to a range from 0.1875% to 0.50% depending on the Company’s leverage ratio; provided, however that the Company will not be required to pay such commitment fee for any month when it has outstanding borrowings greater than 50.0% of the commitments under the Revolving Facility. The Credit Agreement contains representations, warranties and covenants that are customary for similar credit arrangements, including, among other things, covenants relating to (i) financial reporting and notification, (ii) payment of obligations, (iii) compliance with applicable laws, (iv) notification of certain events and (v) solvency. The Credit Agreement contains certain covenants, restrictions and events of default including, but not limited to, a change of control restriction and limitations on the Company’s ability to (i) incur indebtedness, (ii) issue preferred equity, (iii) pay dividends or make other distributions, (iv) prepay, redeem or repurchase certain debt, (v) make loans and investments, (vi) sell assets, (vii) acquire assets, (viii) incur liens, (ix) enter into transactions with affiliates, (x) consolidate or merge and (xi) enter into hedging transactions. The Credit Agreement initially required that the Company maintain, at all times, a ratio of total indebtedness to consolidated EBITDA of not more than 2.00 to 1.00 and a ratio of consolidated EBITDA to fixed charges of not less than 1.50 to 1.00, and the Company was in compliance with all such ratios as of March 31, 2017. The Amended Credit Facility requires that the Company maintain, at all times, a Leverage Ratio of not more than 2.50 to 1.00. The Amended Credit Facility also requires that the Company maintain, at all times, a ratio of consolidated EBITDA to fixed charges of not less than 1.25 to 1.00. Additionally, the Company’s capacity to make capital expenditures is capped at $80.0 million for each fiscal year plus, for fiscal years beginning on January 1, 2019, any unused availability for capital expenditures from the immediately preceding fiscal year; provided, however that the Company is permitted to make any capital expenditures in an amount equal to the proceeds of equity contributions made to the Company used to fund such capital expenditures.

8. Senior Secured Credit Facility

On December 1, 2016, Solaris LLC entered into a credit agreement (the “Credit Agreement”) by and among Solaris LLC, the lenders party thereto from time to time and Woodforest National Bank, as administrative agent (the “Administrative Agent”), providing for $11.0 million aggregate principal amount of senior secured credit facilities (the “Credit Facility”). The Credit Facility initially consisted of (i) up to $10.0 million aggregate principal amount of advance term loan commitments (the “Advance Loan Facility”) available for borrowing until December 1, 2017 and (ii) up to $1.0 million aggregate principal amount of revolving credit commitments (the “Revolving Facility”) available for borrowing until December 1, 2018. As of March 31, 2017, the borrowing base certificate delivered by Solaris LLC under the Revolving Facility reflected a borrowing base as of such date of $1.0 million.

As of March 31, 2017, Solaris LLC had $1.0 million outstanding under the Revolving Facility and $1.5 million under the Advance Loan Facility, of which $0.1 million was current. The Company borrowed an additional $3.0 million under the Advance Loan Facility in April 2017. Proceeds from the Offering were used to fully repay the $5.5 million outstanding under the Credit Facility in May 2017. Interest expense for the three months ended March 31, 2017 bore interest at a weighted average interest rate of 5.33%.

On May 17, 2017, in connection with the Offering, the Company entered into an amendment (the “First Amendment”) to the Credit Agreement (as amended by the First Amendment, the “Amended Credit Facility. The First Amendment, among other things, modified the terms of the Credit Agreement to (i) increase the Revolving Facility from $1.0 million to $20.0 million, (ii) decrease the Advance Loan Facility from $10.0 million to $0 and (iii) amend both the scheduled maturity date of the Revolving Facility and the Advance Loan Facility to be May 17, 2021. Additionally, the First Amendment increased the accordion feature of the Revolving Facility from $1.0 million to $10.0 million, which accordion may be elected by the Company at any time prior to the scheduled maturity date of the Revolving Facility so long as no default or event of default shall have occurred and be continuing and provided that no lender has any obligation to increase its own revolving credit commitment.

The Amended Credit Facility permits extensions of credit up to the lesser of $20.0 million and a borrowing base that is determined by calculating the amount equal to the sum of (i) 80% of the Eligible Accounts (as defined in the Amended Credit Facility), (ii) 65% of the Eligible Inventory/Equipment Value (Appraised) (as defined in the Amended Credit Facility) and (iii) 75% of the Eligible Inventory/Equipment Value (New Build, Acquired or Upgraded) (as defined in the Amended Credit Facility). The borrowing base is calculated on a monthly basis pursuant to a borrowing base certificate delivered to the Administrative Agent and an annual appraisal on the equipment delivered to the Administrative Agent (provided that the Administrative Agent may, at its discretion, require a desktop appraisal on equipment every six months).

Borrowings under the Amended Credit Facility bear interest at a one-month London Interbank Offered Rate (“LIBOR”) plus an applicable margin and interest shall be payable monthly. The applicable margin ranges from 3.00% to 4.00% depending on the Company’s leverage ratio. The leverage ratio is defined in the Amended Credit Facility, as of any day, as the ratio of funded indebtedness, less a cash adjustment of the lesser of $10.0 million or fifty percent of unrestricted cash of the Company and its subsidiaries, to EBITDA, for the twelve months then ended (the “Leverage Ratio”). During the continuance of an event of default, overdue amounts under the Amended Credit Facility will bear interest at 5.00% plus the otherwise applicable interest rate.

The Revolving Facility initially had a scheduled maturity date of December 1, 2018 and the Advance Loan Facility initially had a scheduled maturity date of December 1, 2021. The First Amendment extended the scheduled maturity of the Revolving Facility and Advance Loan Facility to May 17, 2021.

The First Amendment modified the monthly commitment fee we pay on undrawn amounts of the Revolving Facility to a range from 0.1875% to 0.50% depending on the Company’s leverage ratio; provided, however that the Company will not be required to pay such commitment fee for any month when it has outstanding borrowings greater than 50.0% of the commitments under the Revolving Facility.

The Credit Agreement contains representations, warranties and covenants that are customary for similar credit arrangements, including, among other things, covenants relating to (i) financial reporting and notification, (ii) payment of obligations, (iii) compliance with applicable laws, (iv) notification of certain events and (v) solvency.

The Credit Agreement contains certain covenants, restrictions and events of default including, but not limited to, a change of control restriction and limitations on the Company’s ability to (i) incur indebtedness, (ii) issue preferred equity, (iii) pay dividends or make other distributions, (iv) prepay, redeem or repurchase certain debt, (v) make loans and investments, (vi) sell assets, (vii) acquire assets, (viii) incur liens, (ix) enter into transactions with affiliates, (x) consolidate or merge and (xi) enter into hedging transactions.

The Credit Agreement initially required that the Company maintain, at all times, a ratio of total indebtedness to consolidated EBITDA of not more than 2.00 to 1.00 and a ratio of consolidated EBITDA to fixed charges of not less than 1.50 to 1.00, and the Company was in compliance with all such ratios as of March 31, 2017. The Amended Credit Facility requires that the Company maintain, at all times, a Leverage Ratio of not more than 2.50 to 1.00. The Amended Credit Facility also requires that the Company maintain, at all times, a ratio of consolidated EBITDA to fixed charges of not less than 1.25 to 1.00. Additionally, the Company’s capacity to make capital expenditures is capped at $80.0 million for each fiscal year plus, for fiscal years beginning on January 1, 2019, any unused availability for capital expenditures from the immediately preceding fiscal year; provided, however that the Company is permitted to make any capital expenditures in an amount equal to the proceeds of equity contributions made to the Company used to fund such capital expenditures.